Does anyone have a good knowledge of the company car taxation rules? The company which I am about to join seem to have a way round the taxation by topping up my salary with such an amount, relative to a car's lease rate.

Then they get me to undertake a Personal Contract Plan, effectively a private lease contract of a car. This way I only pay income tax on the amount my salary is topped up and the taxation is based on the lease rate of the car and not the list price of the car.

Has anyone ever seen it done in this way before?

-- Anonymous, June 07, 2001

Answers

A Perk?

-- Anonymous, June 07, 2001

I take money instead of a car... and buy/lease my own vehicle.

downside: own insurance/tax/service etc.

upside: less tax/ more income/not tied in to scheme for X yrs

You have to do the maths yourself but I am a LOT better off not taking the car. It depends on how much the salary enhancement is.

-- Anonymous, June 07, 2001

Hmm - I take the easy option. The company pays me to have a car, and as I do a huge private mileage (well, I have to keep visiting me Ma every other weekend in the Autumn/Winter/Spring) even the tax on the petrol card makes me quids in - I think!

-- Anonymous, June 07, 2001

Sounds ok, you will also be able to claim money back through tax free mileage allowances; for a 2000cc car 45p a mile for the first 4000 then 25p per mile after.

The car is no longer a perk, it's a f'king albatross, I've just been done for 5 years of not keeping mileage records.

-- Anonymous, June 07, 2001

This way the lease seems to encompass all the insurance etc etc. I haven't got the details through yet but it all seems a confusing system!

If the company are paying the insurance etc it must be classed as a company car but once answer I got was that the tax would not be based on Emissions and the tax paid would remain the same for the four years which I have the car for.

-- Anonymous, June 07, 2001

I don't do enough private mileage to warrant having the free fuel. So I'll continue to do it on the basis that they pay for my business mileage and I save by keeping the mileage down and not paying the massive fuel benefit charges.

-- Anonymous, June 07, 2001